8/6/2019 Stm Case Study
2/4
Mr. Fasial Farooq CEO of Nirala Sweets, production head and
logistic head is having a discussion
over the problem of supply chain and increasing cost of
transferring products from production house
to the different stores throughout Pakistan. Mr.Awais Anasari
logistics head explains that due to late
delivery of products to the store, customer dissatisfaction
level is increasing because whenever a
customer pay a visits to store, he gets the reply that our
products are on way towards store. Then
Mr.Ahmer Farooq added to the conversation and said that due to
day to day increase in prices of fuel
our transportation cost increased almost 3 times. Due to this
our profits are also declining. Mr. Fasial
Farooq said that is the solution to these problems that we
transfer production to different cities? But if
we do this we will require a huge initial investment said by Mr.
Ahmer Farooq and also for
implementing this strategy it will require a huge time. Then Mr.
Awais Anasari said that if we do this
we will face the problem of quality and the standardization of
products is not possible in every store.
After Mr. fasial farooq then what type of strategy we should
have to adopt in order to improve
companies quality image and timely delivery of products from
production house to store?
Mr.Taj Din started Nirala Sweets in Lahore 1948 after he
migrated from India when the division of
subcontinents took place into India and Pakistan. He was awarded
with some evacuee property on
Fleming road, in the congested inner city, and was encouraged by
a friendand peers to start Puri-
Halwa shop providing breakfast to the many fruit traders who are
dwelling in the adjoining areas. He
gradually introduced mithai (sweetmeats) at the suggestion of
customers and friends, which was an
instant success. As the shop reputation spread outside the
Fleming road, people from other areas of
Lahore became customers and sales showed a steady growth. With
increasing congestion and
accompanying parking problems, business at Fleming road location
appeared to have limited growth
potential. In 1984, Nirala opened another store in the suburb of
Lahore, on jail road, a relatively posh
commercial housing area. Sales grew as most customers now found
great accessibility to what was
generally regarded as Lahore`s best mithai.
Taj Din expired in 1985, the management of the venture passed to
his son Mohammad Farooq who
had been helping his father for several years. With the general
populace of Lahore moving into many
newer residential suburbs, three more stores were opened over
five years. These were located at
Hafeez Centre in Gulberg, Moon Market, Allama Iqbal Town, and
Sadiq Plaza on the Mall, all
relatively located in posh localities. Nirala management felt
that these moves were necessary to
prevent any loss in sales due to other shops restricting Nirala
customers from coming all the way to
Jail Road. All the shops were company owned. All mithai is
prepared at the company owned factory
on Waris road, about five minutes drive from Jail road
store.
By late 1997, Nirala had four retail stores of different sizes
and staff strength located in different parts
of the city. In mid-1999 Nirala opened its first outlet outside
Lahore. This was located in Pakistan`s
capital, Islamabad. The stores carried basically the same
product mix which was sent fresh in company
owned vans from the factory at Warris road Lahore couple of
times per day as needed. The completion
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